Why Buy IBM Shares?

Move over AWESOM-O, IBM's Watson is going to rake in billions in revenue.

IBM (IBM) is firing on all cylinders lately and its share price reflects its staying power by closing above $200 a share this week. IBM's super computer Watson is going to work for Citigroup (C) and its why the Masters want in now.

Last week we recommended buying IBM shares in 3 Stocks to Buy at 12 Month Highs. IBM was trading just under its 12 month high and this week it made the $200 roll hitting $201.19.

Citigroup (C) is hiring Watson to do what no man can do. The AWESOM-O like computer will help analyze customer needs and process financial, economic and client data to advance and personalize digital banking.

Watson already does work for its health-care clients WellPoint Inc. and Seton Health Family by analyzing data to improve care. IBM executives say Watson’s skills -- understanding and processing natural language, consulting vast volumes of unstructured information, and accurately answering questions with humanlike cognition -- are also well suited for the finance industry.

Watson may add $2.65 billion in revenue in 2015, adding 52 cents of earnings per share, Ed Maguire, an analyst at CLSA in New York, estimated in a November research note (source: bloomberg via fa-mag.com)

MASTERY Bottom line:

Need another reason to buy IBM?

Watson is your answer.

Mastery expects IBM to continue to prosper in 2012.

Our 12 month target price for IBM is now $250.